LAHORE: The local cotton market on Thursday remained dull while the trading volume remained low. Cotton Analyst Naseem Usman told that the rate of cotton in Punjab and Sindh is in between Rs 18000 to Rs 20,000 per maund. He also told that due to increase in the rate of dollar the prices of raw materials are also increasing.
ICE cotton futures fell over 1% on Wednesday as investors rolled over their positions from the front-month contract, while declines in equities markets added to the downbeat mood.
The most active May cotton contract on ICE futures was down 1.68 cent, or 1.2%, at 135.85 cents per lb at 11:16 a.m. ET. Prices traded within a range of 135.57 and 138.44 cents a lb.
“Cotton market is revolving around rollovers taking place as investors are selling their positions on the near term. We are seeing a lot of action between May and July contracts and also rollovers from July into December contracts,” said Valentin Olah, cotton risk management consultant at StoneX Group.
“Grains were all trading lower this morning - there was some negativity in the US stock market and cotton tends to follow these markets.”
Wall Street’s main indexes opened lower as investors feared aggressive moves by the Federal Reserve to tackle inflation, with eyes on minutes from the central bank’s March meeting.
Chicago wheat eased after a two-day rally, as investors awaited details of new Western sanctions against Russia and traders assessed harvest prospects with the drought continuing in part of the US Plains.
Market participants now await the US Department of Agriculture’s monthly World Agricultural and Supply Demand Estimates report due on Friday.
The USDA’s weekly export sales report is scheduled for release on Thursday.
“Demand will still be there for US cotton. Drought conditions and on-call situation will be creating a lot of support for cotton in the near term,” Olah added.
Total futures market volume fell by 12,145 to 25,700 lots. Data showed total open interest gained 2,849 to 233,264 contracts in the previous session.
While talking to CNBC Avaz India President Cotton Association of India said that according to the mills association, this year’s Indian crop size is 340 lakh bales out of this around 275 lakh bales is received upto 31st March, and actually there is no problem of daily arrivals.
He told that per day daily arrivals in India are seen 50-65,000 bales while as per news Gujrat alone has arrivals of 25-30,000 bales per day.
The Spot Rate remained unchanged at Rs 20,500 per maund. Polyester Fiber was available at Rs 290 per kg.
Copyright Business Recorder, 2022
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